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Companies registered in Jersey are subject to a number
of general requirements which, whilst not particularly onerous,
should be carefully observed. The most important of these
requirements are set out below.
Returns to the Registrar of Companies
Before the end of February in each calendar year every
company must deliver an annual return to the registrar of
companies. The annual return must set out details of the company's
share capital, its shareholders and, if it is a public company,
its directors. Failure to deliver an annual return by the end of
February will result in a late filing fee becoming payable. If no
annual return has been delivered by the end of June, the company
will be guilty of an offence and liable to a daily default fine.
Resolutions. A printed copy of every:-
Special resolution;
Written resolution or agreement which, if passed
in general meeting, would not have been effective unless
passed as a special resolution;
Resolution or agreement of all the holders of a
class of shares;
Resolution or agreement which binds all the
holders of a class of shares although not agreed to by
all of them;
The above must be delivered to the
registrar of companies within 21 days of the resolution being
passed or agreement entered into.
Rights attaching to shares. If the
rights attaching to shares in a public company are not set out in
its Memorandum or Articles of Association, the company must
deliver a statement to the registrar of companies setting out
particulars of the rights within one month of allotment of the
shares or variation of the rights attaching to them.
Annual General Meetings
A company must hold its first Annual
General Meeting within 18 months of incorporation. Thereafter it
must hold an Annual General Meeting in every calendar year.
Annual General Meetings of a public company must not be held more
than 18 months apart.
Annual General Meetings of a private
company must not be held more than 22 months apart. A private
company can dispense with the holding of Annual General Meetings
if all its shareholders agree to this in writing. Such an
agreement will cease to have effect if any member of the company
gives notice terminating the agreement, if a new member does not
accede to it within 2 months of becoming a member, or if the
company ceases to be a private company.
Accounts
Every company must keep accounting
records sufficient to show and explain its transactions, to
disclose with reasonable accuracy the financial position of the
company at any time and to enable the directors to ensure that
its annual accounts comply with the requirements of the Companies
(Jersey) Law 1991 (" the Companies Law"). It is not
necessary that the accounting records be kept in Jersey, but if
the accounting records of a public company are kept outside
Jersey, returns sufficient to disclose with reasonable accuracy
the financial position of the company at any time and to enable
the directors to ensure that its annual accounts comply with the
requirements of the Companies Law must be kept in Jersey.
Accounts must be prepared at not more
than 18 monthly intervals. The accounts must be prepared in
accordance with generally accepted accounting principles and must
show a true and fair view of the profit or loss of the company
for the period and of the state of the company's affairs at the
end of the period. The accounts of a public company must be
audited. Those of a private company need only be audited if the
company's articles of association or a resolution of the company
in general meeting require the appointment of auditors. The
auditors' report must state whether in the auditors' opinion the
accounts have been properly prepared in accordance with the
Companies Law and whether a true and fair view is given.
The accounts of a public company must
be examined and reported upon by its auditors, approved by its
directors, laid before the company in general meeting together
with a copy of the auditors' report and delivered to the
registrar of companies within seven months of the end of the
financial period to which they relate. The accounts of a private
company must be examined and reported on by its auditors (if
applicable), approved by the company's directors, and, unless the
shareholders have by written agreement dispensed with the holding
of Annual General Meetings, be laid before the company in
general meeting together with a copy of any auditors' report
within ten months of the end of the financial period to which
they relate.
Dividends
If a company wishes to pay a dividend or make any
other distribution of its assets to its members, it may only do
so:
Out of realised profits less realised losses;
Out of realised revenue profits less realised and
unrealised revenue losses where the
directors reasonably believe that following
payment the company will meet the relevant test of
solvency laid down in the Companies Law;
Out of unrealised profits less realised and
unrealised losses where the company has approved the
payment by special resolution and the directors
reasonably believe that following payment the company
will meet the relevant test of solvency laid down in the
Companies Law;
Where the directors reasonably believe that
following the payment the company will meet the relevant
test of solvency laid down in the Companies Law and the
company is an open-ended investment company.
References above to profits are to
accumulated profits so far as not already distributed or
capitalised. References above to losses are to accumulated losses
so far as not already written off in a reduction or
reorganisation of capital.
Any member who knows or has reasonable
grounds for believing that a distribution made to him or her has
been made out of assets not available for this purpose, can be
required to repay the amount received in full at any time.
Name and Registered Office
Every Jersey company must have its
registered office in Jersey. The company's name must be clearly
displayed outside its registered office and must also appear on
all statements of account, invoices, notices and other official
publications and on negotiable instruments and letters of credit
signed by or on behalf of the company. Both the company's name
and the address of its registered office must appear on its
business letters and order forms. If the company's business
letters and order forms make any reference to its share capital, the reference must be to the company's paid-up share capital.
Registers
Every company must keep registers
containing specified details of its members and of its directors
and secretary. Where shares are held by nominees, however, there
is no requirement that details of the beneficial owners be
entered in the register of members. The register of members may
be kept either at the company's registered office or at any other
place in Jersey where it is made up. The register of directors
and secretary must be kept at the company's registered office.
Anyone can ask to inspect a company's register of members and
must be allowed to do so on payment of a fee. A private company
must make copies of its register of members available on request
but a public company need only do so for certain purposes
following compliance with certain formalities. Anyone can ask to
inspect the register of directors and secretary of a public
company or a subsidiary of a public company and must be allowed
to do so on payment of a fee, but there is no right for members
of the public to inspect the register of directors and secretary
of a private company.
A company is a public company if its
Memorandum of Association states that it is a public company or
if the company had more than 30 members on 30th March 1992. Any
other company is a private company but if the number of members
of a private company at any time exceeds 30, it will be treated
as if it were a public company. When ascertaining the number of a
company's members for this purpose, members who are directors,
employees or former directors or employees are disregarded.
Share Certificates
Every company must prepare share
certificates within two months of the allotment or transfer of
any of its shares except where the allotment or transfer is to a
nominee of a stock exchange on which the shares are or will be
listed.
This document is a brief guide to the
subject matter covered, and is not intended to be a detailed or
comprehensive statement of the law. It should not be treated as
legal advice. Clients are urged to take professional legal and
other appropriate advice before pursuing any particular course of
action.
Whilst every precaution has been
taken to check the accuracy of the information contained in this
page, no responsibility can be taken for any inaccuracies contained herein. Please also note that we are not tax advisors.
Professional tax advice should always be taken if in doubt.
